Corruption, deep disparity mark Iraq’s oil legacy post-2003

The oil is pumped 24 hours a day several meters from Raghed Jasim's home in Iraq's crude-rich southern heartland. Gas flares from the field light the night sky bright orange, spewing acrid smoke; when the wind picks up, the 40-year old's clothes are coated black.

For Iraq's poorest, evidence of the country's monumental oil wealth is inescapable. So is the knowledge that very little of it trickles down to them.

Jasim's savings were depleted when he was diagnosed with cancer last year, a disease he is convinced was caused by the toxic plumes. Twenty years since the U.S.-led invasion toppled Saddam Hussein and remade Iraq's political order with the promise of democracy and freedom, he has one wish: To find a way to leave.

"There is no future here for my children," he said.

Basra province, which boasts most of Iraq's oil reserves, is symbolic of the deep disparities that have endured since the 2003 invasion. Basra continually bewilders experts, envoys and residents: How can a relatively stable province so rich in resources rank among the poorest and most under-developed in the country?

"Of course, I blame the corrupt Iraqi government," said Jasim, a policeman, echoing a widespread view in the region. "But I blame the Americans too. They replaced our leaders with thieves."

Local leaders in Basra talk of the oil reserves as both a blessing and a curse. They say resources bring affluence but have also given rise to vicious competition between political elites and armed groups at the expense of the Iraqi people.

The power-sharing system in place since 2003, which divides the state and its institutions along ethnic and sectarian lines, sucks oil wealth into a pool of corruption and patronage. The higher the oil price, the...